Going green for last-mile logistics: Not just a pipe dream | The Financial Express

Going green for last-mile logistics: Not just a pipe dream

In a separate study conducted by the World Economic Forum on last-mile delivery, there will be a 36 per cent rise in the number of global delivery vehicles in the top 100 cities by 2030, to cater to the growing demand of customers worldwide.

Going green for last-mile logistics: Not just a pipe dream
The last mile courier industry annually emits approximately 500 thousand tonnes of CO2 in India. Image: Reuters

– By Mehul Kapadia

Globally, the last mile accounts for up to 50 per cent of total delivery carbon emissions. According to a study by Stand.earth, the last mile courier industry annually emits approximately 500 thousand tonnes of CO2 in India, three million tonnes of CO2 in Europe, and four million tonnes of CO2 in the US. Climate change and its effects on the environment have had governments and corporations rethinking business as usual. Carbon emissions are one of the primary contributors, and much awareness has been created among consumers and corporations to pursue sustainable options. The 2021 United Nations Climate Change Conference, also referred to as the COP26 summit, had a key goal of reducing carbon emissions by 2050 for all countries. Countries like the United States and the EU are running towards that goal. However, India has committed to going carbon neutral only in 2070.

A new IEA analysis states the rate of growth of carbon emissions will be reduced in 2022 thanks to the unprecedented deployment of electric vehicles. However, the overall level of carbon emissions doesn’t seem to follow a downward trend. This could be due to more fossil-fuel-based vehicles plying on the road. In 2021, e-commerce accounted for 20 per cent of global retail sales. It is forecasted that it will be more than a quarter in 2025.  As online sales grow, so do the packages, drivers/delivery folks and of course, the vehicles that are transporting these goods. 

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In a separate study conducted by the World Economic Forum on last-mile delivery, there will be a 36 per cent rise in the number of global delivery vehicles in the top 100 cities by 2030, to cater to the growing demand of customers worldwide. This, in turn, will put more fossil fuel-based vehicles on the road and increase CO2 levels. 

Now, many e-commerce, third-party logistics (3PLs), and Courier, Express, and Parcel (CEPs) companies are looking to adopt the Electric Vehicle (EV) route to align with their sustainability goals, but it’s going to take at least another decade for it to materialize due to factors like increased cost and regulations. So for the time being, fossil fuel-based vehicles are to stay.

Sustainability through the reduction in last-mile emissions 

Adopting robust logistics planning software is the best way to reduce carbon emissions and have sustainability. In the last mile, when the goods are loaded onto the trucks, it’s usually the home stretch for the companies. But due to various factors like traffic, roadblocks, address issues, and technical glitches, more time is spent on the road, more fuel is burnt, and hence more emissions are emitted. Partnering with a state-of-the-art Dispatch Management Software vendor can help the last mile players cut carbon emissions almost in half. 

Typically, without the right dispatch management software to support the logistics functions, logistics managers and fleets are flying blind. Without planning optimal routes to delivery, the fleet is setting itself up for failure. With increasing customer demands for quicker delivery, companies and fleets need to find ways to adhere to these requests without compromising environmental safety. 

AI-driven routing and analytics 

A self-learning last mile software equipped with a dynamic routing algorithm is your best bet. It takes into account hundreds of business and real-world constraints to plan optimal routes for drivers to make on-time and dependable deliveries. Supply chain managers can also leverage the insights dashboard pulled from the on-ground execution data to make the next delivery more economical and environment-friendly. 

Automated sorting and driver convenience

Loading the least suited goods to trucks can make the trip less than optimal as it could cost a few extra miles and hence more carbon emissions. A robust last-mile software usually has a parcel sorting function based on the type of goods, location, and vehicle type, which saves time, money, fuel, and the environment. To make things even easier for fleets, providing them with a mobile application that provides a turn-by-turn navigation function, makes the final delivery even more effective.

As the demand for home deliveries continues to rise and more vehicles are set to ply the road in the coming years, adopting robust logistics software is the first step towards reducing carbon emissions and achieving sustainability and meaningful growth. It also provides advantages such as better ROI, customer delight, and improving your bottom line.

(Mehul Kapadia is the Chief Growth Officer at Locus)

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First published on: 10-11-2022 at 03:03:01 pm
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